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01 July 2015

EC: Commission welcomes deal to improve consumer protection for insurance products


These new rules (revised Directive on insurance sales, known as the Insurance Distribution Directive) will improve the way insurance products are sold and will bring real benefits to consumers and retail investors.

The revised Directive will cover the entire distribution chain and will be referred to as the Insurance Distribution Directive (IDD), replacing the 2002 Insurance Mediation Directive.

Under the new Directive, consumers and retail investors buying insurance products will benefit from:

  • Greater transparency: insurance distributors will have to become more transparent about the price and the costs of their products, so that it is clear to consumers what they are paying for. Importantly, the consumer should know whether the seller of an insurance product has an own economic incentive to sell that particular product.
  • Better and more comprehensible information, so that consumers can take more informed decisions, with a simple, standardised Product Information Document for non-life insurance products. This completes already existing consumer information documents for life insurance products (under the Solvency II Directive) and for investment products (under the PRIIPS Regulation).
  • Where insurance products are offered in a package with another good or service, for example when a new car is sold at a bargain price together with motor insurance, consumers will have the choice to buy the main good or service without the insurance policy.
  • Rules on transparency and business conduct to prevent consumers from buying products that do not meet their needs.

These rules to the benefit of consumers will now also apply when a product is bought directly from an insurance company, and not only (as in the past) when products are bought via a broker or intermediary.

The agreed rules include stronger requirements for the sale of life insurance products with investment elements. In addition, the new text also introduces rules on mutual recognition of professional knowledge and ability, where professionals obtain qualifications in another Member State.

Press release



© European Commission


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